At OnQuote Insurance, we are here to help all Wisconsin residents make the best choices for their families’ financial needs regarding life insurance. When it comes to benefits on a life insurance policy, you designate the policy funds to be left to a beneficiary upon your passing.
A life insurance policy has two types of beneficiaries: primary and contingent.
Understanding Primary Beneficiaries
The primary beneficiary is the first person, group, or organization to which you leave your death benefits. It’s important to note that you can have multiple primary beneficiaries. You would designate a certain percentage of the policy proceeds to each. For example, if you have three children, you are leaving $100,000 of life insurance benefits; you can list all three as primary beneficiaries and split their payout however you wish. You could divide the proceeds into thirds (33.3% each) or choose the oldest to have (50%) $50,000 and the other two to receive (25%) $25,000 each. The choice is up to you.
Understanding Contingent Beneficiaries
A contingent beneficiary is a person, group, or organization that would receive the death benefits if your primary beneficiary was deceased and unable to receive the benefits left to them. For instance, if you named your spouse as a primary beneficiary but listed your children as contingent beneficiaries, your children will inherit the policy benefits if your spouse is deceased before you.
Similar to a primary beneficiary, you can have multiple contingent beneficiaries. Without naming a contingent beneficiary on your life insurance policy, the benefits may be subject to a probate court decision, which could delay the payout of the policy benefits.
Contact OnQuote Insurance for More Information
To learn more about beneficiaries and life insurance-related topics, contact OnQuote Insurance today. We serve clients all over Wisconsin. Call (847) 380-3400.